Ron Coughlin, CEO at Petco Health & Wellness Company (WOOF), recently bought 61,040 shares. The buy increased his stake by 11 percent, and came to a total purchase price of $504,800.
This marks the first insider buy in over 14 months. Insiders have generally been buyers of shares over the past two years, although largely between 2021 and January 2022. There have been two small sales by one insider over the past year.
Overall, company insiders own 65.1 percent of shares.
The pet retailer and pet healthcare company has been a poor performer in the past year, with shares down 57 percent. That’s an extreme move, given that earnings have increased by 12 percent and revenues are up by 4 percent.
That’s taken shares from 38 times earnings last year to just under 14 times forward earnings, a reasonable valuation. Plus, the company’s expansion into healthcare services plays well into increased spending on pets and pet services in the economy in general.
Action to take: Shares look reasonably attractive for long-term investors here. The stock doesn’t pay a dividend, so investors may want to buy a small stake now and use any market dip to add to that position.
For traders, shares have been trending down over the past few months but look oversold. If that’s the case, the June $9 calls, last going for about $0.80, could deliver mid-to-high double-digit gains in the weeks ahead on a move higher.
Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any of the companies mentioned in this article.